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Standard presentation format 2nd quarter 2015 Agenda Central bank’s objectives and structure Real sector Monetary policy External sector Banking sector Central bank’s objectives and tasks STABILITY OF PRICES SUPPORTING THE GENERAL ECONOMIC POLICIES OF THE EUROPEAN UNION, WITHOUT PREJUDICE TO ITS PRIMARY OBJECTIVE Management of the international reserves Issuing banknotes and coins Issuing and revoking licenses for banks and bank supervision Regulating, improving and supervising the payment system Maintaining the stability of the country's financial system Performance of operations on behalf of the Republic of Croatia, as provided by law Independence of the CNB Institutional: decisions are reached independently of other institutions’ influence Functional: clear by defined goal and independence in choosing the instruments and measures for achieving that goal Personal: guarantees the protection of the Governor and the Council members from various kinds of pressure, precisely determines the conditions for the appointment and removal from office, and guards against the conflict of interest Financial: revenues and expenditures of the CNB are solely determined by the nature of the monetary and exchange rate policies Structure of the CNB Agenda Central bank’s objectives and structure Real sector Aggregate demand and supply Labour market Prices Fiscal policy Monetary policy External sector Banking sector Real GDP rates of change Croatia Peer countries 8 6 5 5.2 5.6 5.2 4.1 4.2 4.1 4.8 4.0 4 4 3.5 2.1 3.2 2 % -0.3 -1.1 -2 -1.7 -4 -0.4 2.5 2 1.7 1.5 -2.2 1.1 1 * The data refer to the first quarter of 2015. Note: The data are according to ESA 2010 methodology, after 2013 are provisional. More information can be found on www.dzs.hr. Source: CBS. Croatia Romania Bulgaria Slovenia Poland 2015* 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 -10 Hungary 0 -7.4 Czech R. -8 Slovak R. -6 2002 % 3 0.5 0 Average annual growth rate, 2003 – 2014 Note: The data are according to ESA 2010 methodology. Sources: Eurostat and CBS. Gross value added structure, in current prices, 2015* Agriculture Industry Construction Trade, hotels and restaurants Information and communication Financial and insurance activites Real estate Professional service activities Public administration and defence Other service activities * The data refer to the first quarter of 2015. Note: The data are according to ESA 2010 methodology. Source: CBS. Contributions of domestic and net foreign demand to GDP growth 16 percentage points 12 8 4 0 -4 -8 Domestic demand Net foreign demand 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 -16 2015* -12 GDP * The data refer to the first quarter of 2015. Note: Due to the methodology of GDP calculation, real annual rate of change in the first quarter of 2015 is not equal to the sum of its components' contributions. The data are according to ESA 2010 methodology. Source: CBS. Unemployment rate Croatia ILO unemployment rate, peer countries, 2014 20 25 18 16 20 14 15 % % 12 10 10 8 6 5 4 2 * Registered unemployment rate – the first four months of 2015. Note: Since the beginning of 2007 results from the Labour Force Survey have been published in quarterly dynamics. ILO unemployment rate refers to persons aged 15 years and over. Data on ILO unemployment rate for period 2007 – 2014 have been harmonised with the results of the Cenzus of Population, Households and Dwellings in 2011, and is not comparable with data for period 2000 – 2006 Source: CBS. Croatia Romania Bulgaria Slovenia Slovak R. Poland Hungary 2014 2015* 2013 2012 2011 2010 2009 2008 ILO unemployment rate 0 Czech R. Registered unemployment rate 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 0 Note: ILO unemployment rate refers to persons aged 15 – 74. Sources: Eurostat and CBS. Nominal and real net wages 25 800 20 700 600 15 500 400 % 5 300 0 200 -5 100 -10 Real grow th rate – left * Last available data is for wages paid for March. Sources: CBS and CNB. Nominal net w age – right 2015* 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 0 EUR 10 Total monthly labour costs in the economy, 2014 1,600 1,400 1,000 800 600 400 200 Total labour cost is shown as average monthly gross wage. Sources: CBS and national statistical offices. Croatia Romania Bulgaria Slovenia Slovak R. Poland Hungary 0 Czech R. EUR 1,200 Gross value added in industry per person employed 8 6 percentage change 4 2 0 -2 -4 -6 -8 -10 GVA in industry Employment * The data refer to the first quarter of 2015. Source: CBS. 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 -14 GVA in industry per person employed 2015* -12 Inflation Croatia Year-on-year inflation rates and components’ contribution to consumer price inflation in Croatia 10 7 Core inflation 9 6 percentage points 8 5 4 % 3 7 6 5 4 3 2 2 1 0 1 2014 2015* 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1998 1999 1997 1996 * January – April 2015. CPI inflation (1996-1998 RPI inflation) and core inflation, average year-on-year rate of change. Source: CBS. Source: CBS. 4/15 8/14 12/14 4/14 8/13 12/13 4/13 8/12 12/12 4/12 8/11 12/11 4/11 8/10 12/10 4/10 8/09 Energy Processed food Services 12/09 4/09 8/08 12/08 -1 4/08 -2 0 12/07 -1 Unprocessed food Industrial non-food without energy Consumer price index (%) Inflation in Croatia, euroarea and peer countries 5 4 3.2 3 2.3 1.7 2 1.5 1.3 1.4 % 1.9 1.4 0.8 1 0.4 0.4 0.0 0.4 0.1 0.4 0.2 0 -0.1 -1 Average year-on-year rate of change. Inflation is measured by harmonized consumer price index. Sources: CBS and Eurostat. 2014 Croatia Romania Slovenia Slovak R. Poland Hungary Euroarea Czech R. 2013 Bulgaria -1.6 -2 Consolidated general government revenues and expenditures Croatia Peer countries, 2014 60 50 50 40 % of GDP % of GDP 40 30 30 20 20 10 Revenues According to ESA 2010 methodology. Sources: Eurostat and CBS. Expenditures Revenues According to ESA 2010 methodology. Sources: Eurostat and CBS. Expenditures Croatia Romania Bulgaria Slovenia Poland Hungary 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 0 Czech R. 0 Slovak R. 10 Consolidated general government balance Croatia Peer countries, 2014 0 0 -1 -1 % of GDP -2 % of GDP -3 -4 -2 -3 -5 -4 -6 -5 Sources: Eurostat and CBS. According to ESA 2010 methodology. Sources: Eurostat and CBS. Croatia Romania Bulgaria Slovenia Slovak R. Poland 2014 2013 2012 -6 Hungary Net lending/borrowing, ESA 2010 2011 2010 2009 2008 2007 2006 2005 2004 2003 -8 Czech R. -7 General government debt Croatia Peer countries, 2014 100 90 90 80 80 70 70 % of GDP 60 % of GDP 60 50 50 40 40 30 30 20 20 10 10 Government guaranteed debt includes other sectors' domestic and external debt guaranteed by central government. Sources: Eurostat and CNB. Sources: Eurostat and CNB. Croatia Romania Bulgaria Slovenia Slovak R. Poland Hungary 2014 2013 2012 2011 2010 2009 2008 2007 General government debt including government guaranteed debt 0 Czech R. General government debt 2006 2005 2004 2003 0 Agenda Central bank’s objectives and structure Real sector Monetary policy Central bank’s policy Monetary developments Interest rates External sector Banking sector Foreign exchange interventions and exchange rate 2,800 8.0 2,400 2,000 7.8 1,600 7.6 800 400 7.4 0 -400 EUR/HRK million HRK 1,200 7.2 -800 -1,200 7.0 -1,600 -2,000 6.8 Foreign exchange interventions - left 1/1/15 1/1/14 1/1/13 1/1/12 1/1/11 1/1/10 1/1/09 1/1/08 1/1/07 1/1/06 1/1/05 1/1/04 1/1/03 1/1/02 1/1/01 1/1/00 1/1/99 1/1/98 -2,800 1/1/97 -2,400 6.6 Exchange rate - right Note: EUR/HRK exchange rate before 1999 is calculated as product of DEM/HRK exchange rate and conversion factor (1.95583). Source: CNB. Exchange rate movements before CNB intervention and amount of intervention, 1996 – 2015 EUR/HRK exchange rate, change, % 1.0 0.8 0.6 0.4 0.2 0.0 -0.2 -0.4 -0.6 -0.8 -3,000 -2,000 -1,000 0 1,000 2,000 3,000 intervention, in million HRK (positive value indicates that CNB buys foreign exchange) Exchange rate of the intervention day relative to exchange rate 4 days prior to intervention (y-axis) and the intervention amount (x-axis). Note: EUR/HRK exchange rate before 1999 is calculated as product of DEM/HRK exchange rate and conversion factor (1.95583). Source: CNB. Creation and withdrawal of reserve money 9 8 7 creation 6 5 billion HRK 4 3 2 1 0 w ithdrawal -1 -2 -3 -4 Regular reverse repo auctions and lombard loans Q1/15 Q3/14 Q1/14 Q3/13 Q1/13 Q3/12 Q1/12 Q3/11 Q1/11 Q3/10 Q1/10 Q3/09 Q1/09 Q3/08 Q1/08 Q3/07 Q1/07 Q3/06 Q1/06 -5 Foreign exchange transactions of the CNB Note: Foreign exchange transactions include purchases and sales of foreign currency by the CNB with credit institutions, MF, EC and swap agreements. Positive values reflect the purchase of foreign currency. Values for the reverse repo transactions and lombard loans are shown as change in one quarter. Source: CNB. Reserve requirements and minimum f/c liquidity 80 70 70 60 60 50 50 40 40 % 1/15 1/14 1/13 1/12 1/11 1/10 0 1/09 0 1/08 10 1/07 10 1/06 20 1/05 20 1/04 30 1/03 30 1/02 % 80 Reserve requirement Marginal reserve requirement Minimum foreign currency liquidity % of RR in f/c allocated in HRK Shaded areas represent periods when banks' credit growth was regulated by compulsory CNB bills. Source: CNB. Liquidity surplus and overnight interest rate 22 10 20 9 18 8 16 7 14 5 % 10 4 8 3 6 Liquidity surplus (including overnight deposits w ith the CNB) – right Overnight interbank interest rate – left Source: CNB. 1/15 7/14 1/14 7/13 1/13 7/12 1/12 7/11 1/11 7/10 1/10 7/09 1/09 7/08 0 1/08 0 7/07 1 1/07 2 7/06 2 1/06 4 billion HRK 6 12 Base money M0 70 60 billion HRK 50 40 30 20 10 Other deposits CNB bills on obligatory basis Settlement accounts Currency outside credit institutions Source: CNB. Overnight deposits Statutory reserves in HRK Credit institutions' cash in vaults 4/15 6/14 8/13 10/12 12/11 2/11 4/10 6/09 8/08 10/07 12/06 2/06 4/05 6/04 8/03 10/02 12/01 2/01 4/00 6/99 8/98 10/97 12/96 2/96 4/95 6/94 0 Source: CNB. International reserves Money supply 1/15 4/14 7/13 10/12 1/12 4/11 7/10 10/09 1/09 4/08 7/07 10/06 1/06 4/05 7/04 10/03 1/03 4/02 7/01 10/00 1/00 billion EUR CNB's international reserves and money supply 15 12 9 6 3 0 Credit institutions' assets 450 400 350 billion HRK 300 250 200 150 100 50 Source: CNB. Claims on central government Claims on other domestic sectors Foreign assets Reserves and other assets 1/15 12/13 11/12 10/11 9/10 8/09 7/08 6/07 5/06 4/05 3/04 2/03 1/02 12/00 11/99 10/98 9/97 8/96 7/95 6/94 0 Placements to other domestic sectors (excluding government) Placements-to-GDP ratio Placements to other domestic sectors (excluding government) 300 100 35 30 250 80 25 billion HRK 200 20 60 % 15 150 % 10 100 40 5 20 0 Placements – left Year-on-year rate of change – right Note: One-off effects substantially decreased the stock of placements and in 2012 they relate to the assumption of shipyards loans by the Ministry of Finance and the transaction of one bank which, aiming to reduce its partly recoverable and irrecoverable placements transferred a portion of its claims to a company indirectly owned by the parent bank. One-off effects in 2013 relate to the bankruptcy of Centar banka, methodological changes in the recording of fees and another transfer of one bank’s recoverable and irrecoverable placements to an affiliated enterprise. Source: CNB. 2013 Sources: Eurostat and CNB. 2014 Romania Slovak R. Lithuania Czech R. Poland Hungary Bulgaria Croatia Estonia 0 Slovenia 3/15 6/14 -10 9/13 3/12 12/12 6/11 9/10 3/09 12/09 6/08 9/07 3/06 12/06 6/05 9/04 3/03 12/03 6/02 9/01 3/00 0 12/00 -5 Latvia 50 Loans of other monetary financial institutions 50 year-on-year rate of change 40 30 20 10 0 -10 Household loans 1/15 1/14 1/13 1/12 1/11 1/10 1/09 1/08 1/07 1/06 1/05 1/04 1/03 1/02 1/01 1/00 -20 Corporate loans Note: One-off effects substantially decreased the stock of loans and in 2012 they relate to the assumption of shipyards loans by the Ministry of Finance and the transaction of one bank which, aiming to reduce its partly recoverable and irrecoverable placements transferred a portion of its claims to a company indirectly owned by the parent bank. One-off effects in 2013 relate to the bankruptcy of Centar banka, methodological changes in the recording of fees and another transfer of one bank’s recoverable and irrecoverable placements to an affiliated enterprise. Source: CNB. Loans to households - structure 160 140 100 80 60 40 20 Mortgage loans Source: CNB. Car loans Other loans Housing loans 3/15 9/14 3/14 9/13 3/13 9/12 3/12 9/11 3/11 9/10 3/10 9/09 3/09 9/08 3/08 9/07 3/07 9/06 3/06 9/05 3/05 9/04 0 3/04 billion HRK 120 Currency structure of other monetary financial institutions' placements 100 90 80 70 60 % 50 40 30 20 10 EUR CHF HRK 3/15 9/14 3/14 9/13 3/13 9/12 3/12 9/11 3/11 9/10 3/10 9/09 3/09 9/08 3/08 9/07 3/07 9/06 3/06 9/05 3/05 9/04 3/04 9/03 3/04 9/02 3/02 0 Other currencies Note: Loans in foreign currency include loans denominated in that currency and loans indexed to that currency. Source: CNB. Broad money (M4) 300 billion HRK 250 200 150 100 50 Bonds, money market instruments and MMFs shares F/c deposits* Kuna deposits 1/15 1/14 1/13 1/12 1/11 1/10 1/09 1/08 1/07 1/06 1/05 1/04 1/03 1/02 1/01 1/00 1/99 1/98 1/97 0 Money supply (M1) * Up to November 2010, kuna deposits with a currency clause were included in kuna deposits, and from December 2010 on, they are included in F/c deposits. Source: CNB. Euroisation 90 85 80 excluding kuna deposits w ith a currency clause 75 70 % 65 60 55 50 45 40 Share of f/c deposits in total savings and time deposits Source: CNB. Share of f/c deposits in M4 1/15 1/14 1/13 1/12 1/11 1/10 1/09 1/08 1/07 1/06 1/05 1/04 1/03 1/02 1/01 1/00 1/99 1/98 1/97 35 Average lending interest rates 22 20 methodology changed as of 1 January 2011 18 16 14 % 12 10 8 12/14 3/14 6/13 9/12 12/11 3/11 6/10 9/09 12/08 3/08 6/07 9/06 12/05 3/05 6/04 9/03 12/02 3/02 6/01 9/00 4 12/99 6 Short-term corporate loans without a currency clause Short-term household loans without a currency clause Long-term corporate loans with a currency clause Long-term household loans with a currency clause Note: Details about the new interest rate statistics: Bulletin 204, June 2014 (http://www.hnb.hr/publikac/bilten/arhiv/bilten-204/hbilt204.pdf). Source: CNB. Average deposit interest rates 12 methodology changed as of 1 January 2011 10 8 % 6 4 Kuna time deposits Kuna sight deposits Foreign currency time deposits Foreign currency sight deposits Note: Details about the new interest rate statistics: Bulletin 204, June 2014 (http://www.hnb.hr/publikac/bilten/arhiv/bilten-204/hbilt204.pdf). Source: CNB. 12/14 3/14 6/13 9/12 3/11 6/10 9/09 12/08 3/08 6/07 9/06 12/05 3/05 6/04 9/03 12/02 3/02 6/01 9/00 12/99 0 12/11 2 Interest rate spread 14 methodology changed as of 1 January 2002 percentage points 12 methodology changed as of 1 January 2011 10 8 6 Kuna loans* - kuna deposits* Total loans - total deposits Kuna loans** - f/c deposits * without a currency clause ** with a currency clause Note: Details about the new interest rate statistics: Bulletin 204, June 2014 (http://http://www.hnb.hr/publikac/bilten/arhiv/bilten-204/ebilt204.pdf). Source: CNB. 12/14 3/14 6/13 9/12 12/11 3/11 6/10 9/09 12/08 3/08 6/07 9/06 12/05 3/05 6/04 9/03 12/02 3/02 6/01 9/00 2 12/99 4 Yield on T-bills and kuna government bond 10.000 9.000 8.000 7.000 6.000 5.000 4.000 3.000 2.000 1.000 T-bill – 91 day T-bill – 182 days T-bill – 364 days T-bill – 728 days T-bills, bonds - average price in a month. Note: Details about calculation of yield to maturity: Bulletin 210, January 2015. Sources: MoF and ZSE. 1/15 5/14 9/13 1/13 5/12 9/11 1/11 5/10 9/09 1/09 5/08 9/07 1/07 5/06 9/05 1/05 5/04 9/03 1/03 0.000 BND – 6 years Bonds listed on the ZSE Nom inal value (m illions) Nom inal interest rate Nom inal value (m illions) Nom inal interest rate EUR 1,000 5.375% 10 years EUR 350 4.250% HRK 162 6.125% HRK 115 2005 10 years HRK 5,500 6.750% 10 years HRK 700 The City of Rijeka 2006 10 years EUR 6.500% 2009 13 years EUR 10 Republic of Croatia 2007 10 years 4.500% Hospitalija trgovina d.d. 2010 7 years EUR 8 The City of Vinkovci 2007 9.750% 5.500% Erste&Steiermärkische banka d.d. 2011 6 years EUR 80 The City of Osijek 6.500% 25 5.500% Jadran Galenski laboratorij d.o.o. 2011 5 years HRK 140 4.800% EUR 8 4.750% HP-Hrvatska pošta d.d. 2012 3 years HRK 400 7.750% 9 years EUR 8 6.000% Jadrolinija d.d. 2012 5 years EUR 11 6.500% 2010 10 years HRK 5,000 6.750% Plodine d.d. 2012 3 years HRK 62 9.000% Republic of Croatia 2010 10 years EUR 1,000 6.500% Erste&Steiermärkische banka d.d. 2012 5 years HRK 300 5.875% Republic of Croatia 2010 7 years HRK 4,000 6.250% Institut IGH d.d. 2012 5 years EUR 10 9.000% Republic of Croatia 2011 5 years HRK 3,500 5.750% NETA Capital Croatia d.d.* 2013 unspecified HRK 2 8.000% Republic of Croatia 2011 11 years EUR 1,000 6.500% HP-Hrvatska pošta d.d. 2014 5 years HRK 400 5.125% Republic of Croatia 2013 5 years HRK 6,000 5.250% Dalekovod d.d. 2014 15.3 years HRK 16 4.000% Republic of Croatia 2013 11 years EUR 1,400 5.750% Dalekovod d.d. 2014 15.3 years EUR 1 4.000% Year of issue Original m aturity Currency Year of issue Original m aturity Republic of Croatia 2004 15 years Republic of Croatia 2005 Ingra d.d. 2006 10 years Atlantic grupa d.d. 2011 5 years Republic of Croatia 5.250% Hrvatska elektroprivreda d.d. 2007 25 4.125% Metronet telekomunikacije d.d. HRK 5,500 4.750% 10 years HRK 42 2007 10 years HRK The City of Split 2007 8 years The City of Split 2008 Republic of Croatia Issuer State Issuer Currency Corporate Stock as at 29 May 2015. * With call option. Source: ZSE. Agenda Central bank’s objectives and structure Real sector Monetary policy External sector Exchange rate Foreign trade Current account External debt FDI Banking sector Exchange rate policy Managed floating Exchange rate is market determined and based on supply and demand Central bank intervenes on the forex market through forex auctions, but it DOES NOT defend any predetermined rate or band Foreign exchange market Kuna is fully convertible No restrictions on repatriation of profits and liquidation of investments Banks freely determine the exchange rate, engage in the foreign exchange operations and conduct international payment transactions Current account deficit and FDI 10 8.8 8 7.1 7.1 6.5 5.9 % of GDP 6 5.2 5.1 4.0 4 2.9 2.2 2 1.1 0.8 -0.8 -0.7 2013 2014 0.1 0 Current account deficit FDI liabilities According to BPM6 and ESA2010 methodology. Negative values of current account deficit indicate a surplus on the current account. Source: CNB. 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 -2 Structure of the current account balance 10 0 -5 Goods Source: CNB. Services Primary income Secondary income Balance 2014 2013 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 -15 2012 -10 2000 billion EUR 5 Current account balance by countries, 2014 8 5.8 6 4.1 % of GDP 4 2 0.9 0.6 0.7 0.1 0 -0.4 -2 -1.4 -4 Sources: Eurostat and CNB. Croatia Romania Bulgaria Slovenia Slovak R. Poland Hungary Czech R. -6 Daily nominal exchange rates HRK vs. EUR, USD and CHF CNB midpoint exchange rate 8.5 8.0 7.5 8.0 7.0 6.5 7.5 6.0 7.0 5.5 5.0 6.5 4.5 EUR/HRK Source: CNB. USD/HRK – right CHF/HRK – right 1/1/15 1/1/14 1/1/13 1/1/12 1/1/11 1/1/10 1/1/09 1/1/08 1/1/07 1/1/06 4.0 1/1/05 6.0 Nominal Real, unit labour costs in manufacturing Real, producer prices - right index, 2010 = 100 Q1/15 Q3/14 Q1/14 Q3/13 Q1/13 75 Q3/12 75 Q1/12 80 Q3/11 80 Q1/11 85 Q3/10 85 Q1/10 90 Q3/09 90 Q1/09 95 Q3/08 95 Q1/08 100 Q3/07 100 Q1/07 105 Q3/06 105 Q1/06 110 Q3/05 110 Q1/05 index, 2001 = 100 Index of nominal and real effective kuna exchange rate Real, consumer prices Real, unit labour costs in total economy The real effective exchange rate of the kuna deflated by producer prices is based on the Croatian index of industrial producer prices on the non-domestic market, which is available from January 2010. In 2014 CNB revised the effective exchange rates of the kuna by extending the basket of the main trading partner countries and applying time varying weights. The fall of index denotes appreciation of the kuna. Source: CNB. Q1/05 80 80 70 70 Czech R. Hungary Poland Romania The fall of index denotes real effective appreciation. Sources: BIS and CNB. Croatia Bulgaria Estonia Latvia Lithuania Slovak R. Q1/15 Q3/14 Q1/14 Q3/13 Q1/13 Q3/12 Q1/12 Q3/11 Q1/11 Q3/10 Q1/10 Q3/09 Q1/09 Q3/08 Q1/08 Q3/07 110 Q1/07 110 Q3/06 120 Q1/06 120 Q3/05 90 index, 2005 = 100 100 Q1/05 Q1/15 Q3/14 Q1/14 Q3/13 Q1/13 Q3/12 Q1/12 Q3/11 Q1/11 Q3/10 Q1/10 Q3/09 Q1/09 Q3/08 Q1/08 Q3/07 Q1/07 Q3/06 Q1/06 Q3/05 index, 2005 = 100 Index of real effective exchange rate deflated by CPI 100 90 Slovenia Merchandise trade 2,500 2,000 1,500 million EUR 1,000 500 0 -500 -1,000 Exports (f.o.b.) Seasonally adjusted data. Sources: CBS and CNB. Imports (c.i.f) Balance 1/15 1/14 1/13 1/12 1/11 1/10 1/09 1/08 1/07 1/06 1/05 1/04 1/03 1/02 1/01 1/00 1/99 1/98 -1,500 Gross external debt by debtors 60 50 billion EUR 40 30 20 10 General government Croatian National Bank Deposit-taking corporations, except the central bank Other sectors 2/15 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 0 Direct investments Note: Gross external debt data is in line with the new methodology prescribed by the sixth edition of the Balance of Payments and International Investment Position Manual (BPM6) and the new sector classification of institutional units in line with ESA 2010. Source: CNB. Gross external debt by creditors 60 50 billion EUR 40 30 20 10 Debt securities Currency and deposits Official creditors 2/15 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 0 Private creditors Note: Gross external debt data is in line with the new methodology prescribed by the sixth edition of the Balance of Payments and International Investment Position Manual (BPM6) and the new sector classification of institutional units in line with ESA 2010. Source: CNB. Estimated future principal and interest payments by debtors 16 14 12 billion EUR 10 8 6 4 2 General government Croatian National Bank Deposit-taking corporations, except the central bank Other sectors Other 2020 2019 2018 2017 2016 2015* 0 Direct investments * Data for 2015 refer to repayments made until end-February 2015 and projected repayments for the rest of 2015. Data doesn't include arrears. Note: Gross external debt data is in line with the new methodology prescribed by the sixth edition of the Balance of Payments and International Investment Position Manual (BPM6) and the new sector classification of institutional units in line with ESA 2010. Source: CNB. International reserves in EUR and in months of imports of goods and services 9.5 12.9 11.2 11.2 8.5 12.7 14 12 10.4 10.7 10 9.1 8.7 7.4 6.5 6.6 5.3 5.5 8 6.4 5.7 6 3.8 International reserves (in months of imports) Source: CNB. 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 0 2004 2.5 2003 2 2002 3.5 2001 4 2000 4.5 International reserves (in bil. EUR) billion EUR months of imports 9.3 7.5 External debt ratios 350 300 250 200 % 150 100 Outstanding external debt/GDP 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 0 2000 50 External debt service/Exports of goods and services Outstanding external debt/Exports of G&S Note: Gross external debt data is in line with the new methodology prescribed by the sixth edition of the Balance of Payments and International Investment Position Manual (BPM6) and the new sector classification of institutional units in line with ESA 2010. Source: CNB. External debt ratios by countries, 2014 Outstanding external debt/Exports of G&S Outstanding external debt/GDP 140 250 234.0 124.1 114.6 120 108.4 200 94.7 100 87.9 161.4 150.1 150 138.8 152.3 126.3 % % 95.6 100 70.1 80 66.5 62.9 60 79.6 40 50 20 Sources: Eurostat, CNB and central banks’ websites. Croatia Romania Bulgaria Slovenia Slovak R. Poland Hungary Czech R. Croatia Romania Bulgaria Slovenia Poland Hungary Czech R. Slovak R. 0 0 FDI, net incurrence of liabilities 4,000 3,642 3,377 3,500 2,876 million EUR 3,000 2,615 2,500 2,278 2,000 1,593 1,434 1,338 1,500 1,124 1,099 1,019 842 1,000 1,049 1,109 1,010 1,044 735 511 500 0 * Preliminary data. Source: CNB. 2014* 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 -500 FDI, net incurrence of liabilities by country of origin 4,500 4,000 3,500 million EUR 3,000 2,500 2,000 1,500 1,000 500 0 2004 EU member countries EU 15 European developing countries International financial institutions Other developed countries Other developing countries Other countries * Preliminary data. Source: CNB. 2014* 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1997 -1,000 1998 -500 FDI, net incurrence of liabilities 1993 – 2014* (29,349.8 million EUR) Other developed countries 8.7% International financial institutions 1.2% Other developing countries 0.2% Other 0.8% 2004 EU member countries 14.2% European developing countries 1.6% EU 15 73.3% * Preliminary data. Source: CNB. FDI, net incurrence of liabilities 2014* (2,876.1 million EUR) Austria 10.5% Luxembourg 1.5% Sw itzerland 13.7% Russian Federation 1.4% Liechenstein 1.2% Ireland 1.0% France 1.0% Italy 0.9% Greece 0.7% Other countries 4.9% Netherlands 63.2% * Preliminary data. Source: CNB. FDI, net incurrence of liabilities 1993 – 2014* (29,349.8 million EUR) Financial intermediation, except insurance and pension funding Other business activities Wholesale trade and commission trade, except of motor vehicles and motorcycles Real estate activities Post and telecommunications Retail trade, except of motor vehicles and motorcycles; repair of personal and household goods Manufacture of chemicals and chemical products Manufacture of coke, refined petroleum products and nuclear fuel Real estate Manufacture of other non-metallic mineral products Other activities * Preliminary data. Source: CNB. FDI, net incurrence of liabilities 2014* (2,876.1 million EUR) Other business activities Financial intermediation, except insurance and pension funding Hotels and restaurants Retail trade, except of motor vehicles and motorcycles; repair of personal and household goods Real estate Manufacture of chemicals and chemical products Real estate activities Post and telecommunications Construction Manufacture of other non-metallic mineral products Other activities * Preliminary data. Source: CNB. Agenda Central bank’s objectives and structure Real sector Monetary policy External sector Banking sector Size, structure and concentration Leverage ratio and capital adequacy Profitability Coverages Structure of loans and deposits by institutional sectors Total assets of the banking system 406.9 399.9 397.9 395.9 2013 2014 391.1 2012 378.4 400 2011 450 370.1 345.1 350 billion HRK 304.6 300 260.3 250 200 150 100 50 Source: CNB. 2010 2009 2008 2007 2006 2005 0 Number of banks 40 35 30 14 15 25 16 16 15 15 17 16 16 20 16 15 10 18 16 15 16 17 16 13 13 12 10 Source: CNB. Private domestic banks 2 2 2 2014 2 2013 2 2012 2008 Foreign owned banks 2 2011 2 2010 2 2009 2 2007 2 2005 0 2006 5 State owned banks Banking system by ownership 100 90 70 91.3 90.8 90.4 90.6 90.9 90.3 90.6 90.1 89.7 90.1 5.3 3.4 5.0 4.2 4.9 4.7 4.9 4.4 5.0 4.2 5.4 4.3 4.8 4.5 5.2 4.8 5.1 5.3 4.8 5.2 2007 2008 2009 2010 2011 2012 2013 2014 60 2006 % of total assets 80 50 40 30 20 10 2005 0 Foreign owned banks Source: CNB. Other private domestic banks State owned banks Concentration index share of assets of the 2(4) largest banks in total assets 80 63.9 64.1 64.9 70 66.4 65.3 65.2 64.8 66.8 66.9 66.5 % of total assets 60 50 43.0 41.3 40.9 41.6 41.7 42.0 42.3 43.3 43.4 43.4 40 30 20 Two largest banks Source: CNB. Four largest banks 2014 2013 2012 2011 2010 2009 2008 2006 2005 0 2007 10 Herfindahl – Hirschman index (HHI) 1,427.2 1,440.5 1,422.3 2013 2014 2008 1,400.6 2012 1,308.9 1,361.7 2011 1,277.7 1,366.4 2010 1,296.5 2007 1,357.9 2006 1,400 2009 1,600 1,200 1,000 800 600 400 0 2005 200 HHI (Assets) Source: CNB. Leverage ratio equity capital/total assets 14.0 14.1 14.0 2014 13.8 2013 13.9 2012 13.7 2010 13.0 14 2009 16 11.5 12 9.7 10 8.8 % 8 6 4 2 Source: CNB. 2011 2008 2007 2006 2005 0 Total capital ratio own funds/total exposure to risks 25 20.89 21.04 21.43 19.55 20 18.78 16.43 16.36 14.62 13.98 2005 2006 15.16 15 % 10 5 Source: CNB. 2014 2013 2012 2011 2010 2009 2008 2007 0 ROAA and ROAE 16 15.1 14 12.4 12 10.9 9.9 10 % 8 6.5 6.9 6.4 6 4.8 3.6 4 2 1.7 1.6 1.6 1.5 1.2 1.1 1.1 0.8 0.2 0.8 0.6 ROAA before tax Source: CNB. ROAE after tax 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 0 3.3 5.3 7.9 9.0 10.2 11.6 12.2 92.1 91.0 89.8 88.4 87.8 2014 3.1 2013 3.2 2012 4.0 2011 100 2010 Classification of placements and off-balance sheet liabilities of banks 90 80 70 60 % 50 96.0 96.8 96.9 96.7 94.7 40 30 20 10 Risk category A Source: CNB. 2009 2008 2007 2006 2005 0 Risk categories B and C Coverages 80% 70% 60% 58.2% 54.8% 52.2% 51.5% 50% 46.6% 47.5% 43.4% 40.9% 42.8% 43.9% 40% 30% 20% 10% 3.2% 2.6% 2.5% 2.4% 3.2% 4.1% 4.7% 5.3% 6.3% 7.2% Coverage 1 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 0% Coverage 2 Coverage 1 = Total value adjustments and provisions/Total placements and off-balance sheet liabilities Coverage 2 = Value adjustments and provisions/B and C placements and off-balance sheet liabilities Source: CNB. Structure of extended loans (gross) by institutional sectors 31 December 2014 Other 1.2% Government units 15.4% Financial institutions 2.3% Households* 43.7% Enterprises 37.4% * Includes non-profit institutions serving households. Source: CNB. Structure of received deposits by institutional sectors 31 December 2014 Non-residents 13.1% Government units 2.5% Financial institutions 5.9% Enterprises 15.7% Non-profit institutions 1.2% Households 61.6% Source: CNB.